Could Mexico be at the start of a solar boom?

The sun isn't just good for tourists

Mexico is not the first country people usually think of when talking of clean energy, but it has ambitious plans to generate 35% of its energy from clean sources by 2026. That would be up from less than 15% now, which is mostly hydro, with wind and solar only providing only ±1.5%. These renewable sources would need to grow a lot, and in such a sunny country, solar power makes a lot of sense.

First Solar Inc. (FSLR) of the U.S. has bought its first projects in Mexico, while more than a dozen other developers including Germany’s Saferay GmbH and Spain’s Grupotec Tecnologia Solar SL own licenses there. Local investor Gauss Energia opened Latin America’s largest photovoltaic plant in the country last month

The project “will open the way for the development of the photovoltaic sector,” Gauss Chief Executive Officer Hector Olea said in an e-mail. “There have been multiple announcements but very little real development work so far even though the regulatory system is sound and conducive to bankable projects.”

While Mexico doesn't subsidize solar, it has net-metering, and high energy costs in many regions where solar is competitive (in good part because the country gets so much sun). With some incentives for solar, which would only be fair considering how government-favored the oil industry has been over the years, we could potentially see a big solar boom in Mexico.